The Centennial Coal Company Ltd has tipped higher prices and production in the future despite a fall in first half profit, which it said was still better than expectations.
Centennial Coal, the nation's largest independent coal producer, on Friday reported a 27 per cent fall in net profit for the six months to December 31 to $31.1 million.
The fall reflected the effects of the stronger Australian dollar and weaker coal prices.
Revenue was down 13 per cent at $381.9 million compared to $439.2 million in the prior first half.
Chief executive Bob Cameron said the prior corresponding first half result had reflected booming coal prices.
"It is still pretty tough now to be comparing ourselves to our best half ever," Mr Cameron said in a webcast.
"Basically in this period we exported more coal, pro-rata particularly, but our export sales price obviously - as it did for everybody - fell," he said on Friday.
Centennial's second half production target is 2.6 million to 2.8 million tonnes of exports, up from 2.2 million tonnes in the first half.
The company is a producer of thermal coal, which is used mainly for power generation.
It is the major fuel supplier to the New South Wales powery industry and also exports coal to Asia.
"We think it is an absolutely excellent market at the moment," Mr Cameron said.
Mr Cameron said there were indications prices would rise, with thermal spot prices already well above last year's Japanese benchmark price of $US70.50 per tonne.
Patersons Securities analyst Andrew Harrington said Centennial's first half result was good and well above what was expected.
"The profit number is better than I expected because their cost reductions were better than I expected, outside of royalties," Mr Harrington told AAP.
He said the company had taken advantage of federal government stimulus tax discounts to minimise its tax bill, with the extra revenue pumped into projects to increase future earnings.
"I was relatively pleased by the results," Mr Harrington said.
Shares in Centennial finished up three cents, or 0.79 per cent, to $3.82. http://money.ninemsn.com.au/article.aspx?id=1014678
CEY Price at posting:
$3.82 Sentiment: Hold Disclosure: Held
